Raise Taxes?

Although it seems to be less of an immediate concern right now in the media, Congress still hasn’t come to a decision on whether to raise the debt limit or not.  Historically this has usually been an easy vote, except that one time when they didn’t raise it and the government went into default (yet we’re still here).  The reason, as I explained earlier, is that while the Democrats just want to borrow more money to fund their excessive programs the Republicans want to put measures in place that will ensure that our nation starts down a road to fiscal responsibility so that we won’t have to default later when we have more debt and no one is willing to to lend money to the US. 

Of course, even those who agree on taking measures to decrease the debt as part of raising the debt limit do not agree on how to do it.  The Democrats want to increase taxes, while the Republicans (for the most part) want to cut spending.  Of course, most Democrats want to include both, since taxing to rich 100% would be no where near enough to sustain current spending. 

I would argue, however, that raising taxes on the wealthy will not, as the Democrats claim, increase revenue.  Although this idea is somewhat counter intuitive, it is rather simple and has been proven a number of times.  The idea goes something like this.  When you raise taxes, you encourage people to put their money into tax-free forms, meaning that the government does not get the money anyway and often gets less, despite the higher tax rate.  In addition to this, high taxes discourage entrepreneurship and encourage the rich to hunker down and try to weather the storm instead of going out, taking risks, expanding their businesses, and hiring more workers.  This in turn causes the economy to go down and causes their to be even less wealth around, leaving even less for the government to tax. 

This phenomenon has been proven a number of times in the past.  President Regan’s tax cuts actually caused an eventual increase in government revenue, which the Liberals promptly spent.  That wasn’t the first time, however, there were other times that this correlation has been seen, although I can’t remember the times and names involved right now.

This brings up another point that I think is worth considering.  Historically, whenever new revenue has been created, the Democrats (and sometimes Republicans, unfortunately) have spent the money on new programs instead of paying off our nations debts.  The obvious way to avoid this happening in the near future is to make the government make due with what they have instead of giving them more money.  Just think, when you have an individual who is physically irresponsible, you don’t give the individual more money, you set up a way for them to live within their means and avoid the problem in the future.  Otherwise they’ll just go out and spend it and come back to you again wanting more money.  That’s how I feel our government has been acting ever since the start of the great depression.  Hopefully, now that America has elected congressmen and senators who have vowed to turn our nation around physically and stop the government from taxing us to pay for actions that we don’t want and that infringe on our rights, the story will be different this time.  However, considering how vicious the democrats are becoming at the threat of losing their precious big government program, I can only hope that the political theater will shift even more in favor of the Republicans in the upcoming elections.